PFF - LDP: A Preferred Stock Fund That Deserves Its Name

2025-01-27 05:39:28 ET

Summary

• The Cohen & Steers Limited Duration Preferred and Income Fund offers a high yield of 7.63%, outperforming most preferred stock index funds but lagging behind other preferred closed-end funds.
• The fund's performance has been disappointing recently, underperforming the preferred stock index as well as some peers.
• The fund is almost entirely invested in preferred securities, which sets it apart from peers that invest in a mixture of preferred stock and corporate bonds.
• The fund primarily invests in preferred securities, with a low leverage ratio of 32.80%, making it suitable for risk-averse investors despite its lower yield.
• Currently trading at a 5.56% discount to net asset value, the fund is reasonably valued compared to its peers but has traded at better prices historically.

The Cohen & Steers Limited Duration Preferred and Income Fund ( LDP ) is a closed-end fund that provides a solution for investors who are looking to earn a very high level of income from the assets that they already possess. The fund manages to do pretty well at this task, as its 7.63% current yield is significantly higher than that of most preferred stock index funds. We can see that quite clearly here:

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